Israel shedding high-cost menial high tech jobs

Dec 27, 2012 (Globes - McClatchy-Tribune Information Services via COMTEX) --
The latest announcements by Micron Technologies Inc. (NYSE: MU) that it would close its Israeli operations by 2015 and fire hundreds of employees, and the difficulties faced by Flextronics International Inc. (Nasdaq: FLEX), which will result in the firing of 600 employees at its Ofakim fab, have reignited the debate over the cost of Israeli high tech workers.

The cost of Israeli high tech workers is relatively high, causing the loss of certain professions, especially quality assurance and software and systems installers, to cheaper Asian countries. The loss of jobs is worrying many people in the industry.

Israel Association of Electronics and Software Industries chairman and former Motorola Israel CEO Elisha Yanai recently told "Globes", "In the past decade, we've lost our national focus and neglected high tech." He estimates that, in the past five years, Israeli companies have transferred at least 20,000 jobs to India and the Far East. The professions shedding jobs abroad currently employ an estimated 50,000 Israelis.

Is Israeli high tech under threat or is it evolving in a way that will not jeopardize the industry To answer the question, "Globes" spoke with three executives: Nurit Berman, CEO of Korn Feffy International affiliate Emda, an executive recruitment firm; Yair Rosilio, CEO of Naya Technologies Ltd., a consultancy firm, which also operates Naya College for high-tech skills; and Shay Zinger, CEO of NGsoft Ltd., a software services firm for digital, mobile, and interface design solutions.

"Globes": Even before the risks in these fields, if they exist, why are the jobs in them leaving Israel
Zinger: "Every profession based on drudge work is fated to leave Israel. Look at what happened to the textile industry, for example. We're a small country, but salaries are high. It's possible to export jobs to other countries, such as India, Ukraine, and China, where people do these jobs -- QA, systems, software installation -- for less money. Israel's high-tech industry should focus on creativity, such as designing applications for iPhones. That cannot be outsourced."
Berman: "It's part of a global trend, driven by lower demand for these skills by young people in the West. For example, there has been a 35 percent drop in demand for computer science in the US."
Can the slide be stopped
Zinger: "The move of lower high tech strata -- QA, systems, software installation -- is hard to stop. The experts will stay, but their value in the market is falling. People who want to stay in the field have to specialize, or they'll be without work. Projects are leaving Israel, and there are tens of thousands of high tech employees whose future career has been hanging in the balance for years. Today, people losing their jobs in these professions have a problem because no one is waiting outside with open arms. In contrast, developers, application designers, and database creators are in demand. There was a time when no one wanted their kid to become a graphic designer, but app designers have become much sought after in recent years."
What would you advise employees in these professions to do
Rosilio: "If a young man comes to me and asks what I advise him to study, I'll first send him to learn something that interests him, but I'd tell him that employers will fight for his creativity. Today, high tech workers in these fields have a problem: if they stay where they are, they're fated to lose their jobs. That's why many are retraining to DBA (database administration), business intelligence development, iPhone app development, or a profession where the skill will not be foresworn so fast. Some people quit the field altogether and become teachers."
Berman: "70 percent of the professions needed today did not exist five years ago. In general, I advise people, 'don't acquire a skill, acquire smarts'. Acquire an infrastructure that will help you keep up-to-date. But the employee isn't the only one who should develop his skills. The enterprise also has to invest in the capabilities of its employees. A person who joins a company should check if it's developing; if it invests in its employees."
Rosilio: "If you think that big companies, with thousands of employees, will take care of their future, you're wrong. It's very easy to forego people. For example, I know someone who worked at a big company, was an outstanding and highly appreciated employee, but the moment the projects she was working on were completed, she was fired. Almost all of employees in these fields -- thousands of people -- are stuck. A big enterprise won't take responsibility on its own. It's the responsibility of both the employee and the enterprise. The employee must also take responsibility for his future."
Berman: "Responsibility and motivation to develop and improve are found in everyone. He must demand this from the enterprise."
What will happen to the professions that will disappear from Israel Shouldn't we try to stem this process
Zinger: "This is a natural process of the changing of the guard. There's no need to intervene. You have to accept that there are professions which ought to move to cheaper locations. Some things will disappear, some will stay, but as a manager, you have the business responsibility to give employees the option to move forward, so that they will stay relevant and creative -- and you too. This isn't a matter or morals, but of business."
Rosilio: "I think that it's in our interest as managers to create as many jobs as possible."
Zinger: "Our interest is to be globally competitive."
Rosilio: "Our effort as managers to prevent the export of these jobs will ultimately pay off in the future."
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